"Ah this is going to be so awkward... okay, I appreciate you are being nice and friendly, and that is really appreciated, but I think this is a bit too personal and I don't think our thoughts on that are going the same direction. I may be wrong and you are just trying to be super friendly but I just feel this is the case. I cannot accept this gift because it would make me feel guilty for both accepting that and you would be expecting something in return. I am really sorry but I think this is going to be more disappointment for you if I don't speak up now. I hope I have not created false expectations based on my actions, at least that has not been the intent. I don't know how to make this less awkward but could you possibly gift it to someone else or return it? I am really really sorry."
If I had bothered to think what to choose for you, I shall also take care of the aftermath. not a big deal. The "awkwardness" is the favor I do for you for Christmas... It is all about appreciations and goods